Prospecting – The Lifeblood of Selling Chapter 7 Prospecting – The Lifeblood of Selling McGraw-Hill/Irwin Fundamentals of Selling, 10/e Copyright © 2008 The McGraw-Hill Companies, Inc. All rights reserved.

7 Chapter 7-3

Main Topics The Tree of Business Life: Prospecting The Sales Process Has 10 Steps Steps Before the Sales Presentation Prospecting—The Lifeblood of Selling Where to Find Prospects Planning a Prospecting Strategy

Main Topics Prospecting Methods Prospecting Guidelines The Referral Cycle Call Reluctance Costs You Money! Obtaining the Sales Interview Wireless E-mail Helps You Keep in Contact and Prospect

The Tree of Business Life: Prospecting Guided by The Golden Rule, remember: People buy from those they know and trust Prospecting is not easy unless you focus on helping, not selling People who trust you give referrals Referrals take the burden of prospecting off the salesperson Referrals are earned through integrity, trust, and character T T Ethical Service T T T T T T T T Builds T r u e Relationships T C I

Exhibit 7-1: The Selling Process Has 10 Important Steps 1. Prospecting The sales process is a sequential series of actions 2. Preapproach/planning 3. Approach 4. Presentation 5. Trial close 6. Determine objections 7. Meet objections 8. Trial close 9. Close 10. Follow-up

Some Prospect, Some Do Not Many salespeople prospect, both those selling business-to-business and those selling to consumers Examples are: Financial services as life insurance Real estate

Compensation for the Salesperson that Prospects is Often: Based upon 100% commission – if you do not sell, you do not earn

Some Prospect, Some Do Not, cont… Many organizations do not prospect Examples are large consumer goods firms as General Mills* and Colgate* * products and associated images used for illustrative purposes only

Compensation for the Salesperson that Does Not Prospect is Often: Based upon mostly salary with a small bonus and expenses such as car and office supplies paid If you do not sell you still get paid, but not for very long

The Prospector Has the Most Challenging Sales Career This is the “order getter” who: Finds a lead Converts the lead into a prospect Sells one day, and Sells in the future too WOW! That is a challenge

Steps Before the Sales Presentation Prospecting > appointment > planning Rule of thumb 40% preparation 20% presentation 40% follow-up

Exhibit 7-2: Before the Sales Presentation

Prospecting–The Lifeblood of Selling Prospect – qualified person Prospecting – Identifies potential customer Lead – only know name

Prospecting–The Lifeblood of Selling Qualified prospect is MAD Money to buy? Authority to buy? Desire to buy? Sales Prospecting Funnel All leads and prospects must be considered and filtered through the MAD process before they become qualified prospects

The Leaking Bucket Customer Concept All salespeople lose X amount of sales and customers per year. This is illustrated in the Leaking Bucket Customer Concept: Customers come into the top and leave through a hole in the bottom

Where to Find Prospects Sources may be varied or few Persons selling different services and goods might not use the same sources

Planning a Prospecting Strategy Prospecting requires a strategy A skill that can be constantly improved

Exhibit 7-4: Prospecting Methods that Work!

Prospecting Methods E-prospecting on the Web Cold canvassing Individuals Organizations Cold canvassing Endless chain – customer referral Orphaned customers Sales lead clubs

Prospecting Methods, cont… Prospect lists Become an expert – get published Public exhibitions and demonstrations Center of influence Direct mail Telephone and telemarketing Observation Networking

Exhibit 7-5: The Processing System Within a Telemarketing Center

Exhibit 7-6: Reports From a Telemarketing Center to Other Marketing Groups Within the Firm

Prospecting Guidelines Three criteria are: Customize to each prospect Concentrate on high potential customers fruit Call back on no-buys Always keep knocking on prospect’s and customer’s door to help them

Referrals Are Used in Most Prospecting Methods Cold canvassing Endless chain customer referrals Orphaned customers Sales lead clubs Public exhibitions and demonstrations Center of influence Telephone Networking

The Prospect Pool Leads Referrals Orphans Your customers

Exhibit 7-7: Components of the Prospect Pool

The Referral Cycle Obtaining referrals is a continuous process without beginning or end Referral cycle – when and how to ask for referrals The parallel referral sale Sell the product to person Obtain prospect name(s) from person

The Referral Cycle, cont… The secret is to ask correctly during referral cycle The preapproach contact phase The presentation Product delivery contact phase Service and follow-up contact phase: Customer service

Exhibit 7-8: The Referral Cycle: When to Ask for Referrals

Don’t Mistreat the Referral Mistreatment can have a ripple effect The mistreated referral tells your customer – you may lose both! Remember to follow the Golden Rule

Treat the Referral Like a Customer Once you have sold the referral, and gotten more referrals, ask the new customer to contact the referring customer on her experience with the salesperson Now you have two customers giving referrals This can create an endless chain of referrals quickly filling your prospect pool with only customers and referrals Now, no more cold calling

Call Reluctance Costs You Money! Call reluctance refers to not wanting to contact a prospect or customer For many salespeople, owning up to call reluctance is the most difficult part of combating it Call reluctance keeps you from: Helping others Earning what you’re worth

Obtaining the Sales Interview Key factor in selling process is obtaining a sales interview The benefits of appointment making Telephone appointment Personally making the appointment Believe in yourself Develop friends in the prospect’s firm Call at the right time on the right person Do not waste time waiting

Wireless E-Mail Helps you Keep in Contact and Prospect Wireless E-mail helps keep the sales representative mobile.

Summary of Major Selling Issues The sales process involves a series of actions beginning with prospecting for customers Find prospects to contact Obtain appointments Plan the entire sales presentation

Summary of Major Selling Issues, cont… Popular prospecting methods Cold canvas Endless chain methods Public exhibitions and demonstrations Locating centers of influence Direct mailouts Telephone and observation Salesperson must develop ways of getting to see the prospect